Justice News

Palm Beach, Florida Home Health Care Company and Its Owner Agree to Resolve False Claims Act Allegations for $1.5 Million

Healthquest, Inc. and its owners, Frank Jaramillo and Ruth Jaramillo, have agreed to pay $1.5 million to the United States to settle allegations that Healthquest paid kickbacks to marketers in order to induce patient referrals, the United States Attorney’s Office announced today. Healthquest is a home health care company located in Palm Beach Gardens, Florida. The defendants also entered into a five-year Integrity Agreement with the Department of Health and Human Services, Office of Inspector General that includes, among other things, an Arrangements Review including a systems review and a transaction review to be conducted by an Independent Review Organization.

Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Shimon R. Richmond, Special Agent in Charge for the U.S. Department of Health & Human Services, Office of Inspector General (HHS-OIG), made the announcement.

The United States alleged that from December 2013 to May 2017, Healthquest paid kickbacks to its marketers in order to induce them to refer patients to Healthquest for home health services.

The lawsuit was filed by a former marketer for Healthquest. She filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties, known as relators, to sue on behalf of the government and receive a share of any recovery. The act also authorizes the government to intervene in and assume primary responsibility for litigating the lawsuit, as the government has done in this case. The relator in this case will receive $300,000.

“Kickback schemes drive up the cost of health care and lead to medical services that are often unnecessary and not in the best interests of patients,” said United States Attorney Benjamin G. Greenberg. “The U.S. Attorney’s Office will continue to hold health care companies and their owners responsible for using kickbacks to line their pockets at the expense of taxpayers and federal health care beneficiaries.”

“Referrals resulting from kickbacks that are designed to increase profits rather than improve the health of patients will not be tolerated,” said Special Agent in Charge Richmond. “OIG Special Agents are tireless in their efforts to uproot such schemes and eliminate fraud, waste, and abuse in Federal health care programs.”

The settlement was the result of a coordinated effort by the United States Attorney’s Office for the Southern District of Florida and HHS-OIG. The case was investigated and the settlement negotiated by Assistant U.S. Attorney Susan Torres. The integrity agreement was negotiated by OIG Senior Counsel Nancy Brown.

The case is captioned United States ex rel. Perez v. Healthquest, Inc. et al., No. 16-81147-Civ-Rosenberg (S.D. Fla.). The claims asserted against Healthquest, Inc., Frank Jaramillo, and Ruth Jaramillo are allegations only, and there has been no determination of liability.